Post Session: Quick Review

Indian equity benchmarks traded on a lackluster note throughout the day and ended the session flat with negative bias. The equity benchmarks made a positive start in early deals as traders took some support with report that the government is planning to make it mandatory for unlisted companies to dematerialize their shares as part of the broader crack down on black money. The Ministry of Corporate Affairs (MCA) is in talks with the Securities and Exchange Board of India (SEBI) and depositories on the matter. Some support also came on private report that emerging as a significant source of investments into capital markets, Employees Provident Fund Organisation (EPFO) is likely to pump in Rs 25,000-30,000 crore in equities in 2017-18 with Rs 5,700 crore already invested this year so far. The report added that National Pension Scheme (NPS) is also among the sources for driving the domestic flow surge, which has been positive for the past 17 months.

Investors took note of former RBI Governor Raghuram Rajan’s statement that India needs to focus on three areas -- infrastructure, power and exports -- to stimulate GDP growth, which has been hit by factors like demonetization. Meanwhile, Reserve Bank of India deputy governor Viral Acharya suggested that deposit franchise of state run banks which are in the intensive care unit be sold off to private sector banks as the time may be running out for state-run banks to clean-up their balance sheets and recapitalize. Confirming that a new list of stressed accounts has been sent to banks for resolution by the RBI, Acharya said that insolvency code has changed rules of the game and asked lenders to use it extensively for resolving the stress. Separately, as per a foreign brokerage report the country’s current account deficit is likely to widen to 3 per cent in the second quarter of 2017 due to sharp deterioration in trade deficit. The report said despite the wider current account deficit, financing is not a concern.

On the global front, Asian markets closed mixed, supported by solid Chinese trade data. China’s trade balance data came in at a surplus of $41.99 billion, narrower than the $48.6 billion expected for August. Imports jumped 13.3%, better than the 10% gain seen, while exports rose 5.5%, compared to a gain of 6.0% expected. The European markets were trading mostly lower amid ECB President Mario Draghi’s suggestion that it may begin tapering its massive stimulus programme this autumn continued to underpin the euro. Manufacturing production in the UK rose more than forecast in July, bolstering optimism over the British economy.

Back home, most of auto stocks were under pressure ahead of GST Council meet with respect to cess hike on SUVs and luxury cars. The GST Council, chaired by Union Finance Minister Arun Jaitley and his state counterparts, will decide the quantum of cess hike in each variety of car in its meeting on September 9. The government has already notified hike in GST cess on a range of cars from mid-size to luxury variants to a maximum of 25%, from the earlier 15%.

The BSE Sensex ended at 31654.56, down by 8.18 points or 0.03% after trading in a range of 31619.00 and 31763.70. There were 10 stocks advancing against 21 stocks declining on the index. (Provisional)

The broader indices ended in red; the BSE Mid cap index was down by 0.49%, while Small cap index was down by 0.14%. (Provisional)

The top gaining sectoral indices on the BSE were Capital Goods up by 1.77%, Industrials up by 0.64%, Telecom up by 0.44%, FMCG up by 0.27% and Bankex up by 0.05%, while Realty down by 1.86%, Power down by 1.03%, PSU down by 1.02%, Healthcare down by 1.01% and Auto down by 0.66% were the top losing indices on BSE. (Provisional)

The top gainers on the Sensex were Larsen & Toubro up by 3.95%, Bharti Airtel up by 1.65%, Kotak Mahindra Bank up by 1.21%, HDFC Bank up by 0.93% and Wipro up by 0.75%. (Provisional)

On the flip side, Mahindra & Mahindra down by 3.12%, Dr. Reddy’s Lab down by 3.01%, Bajaj Auto down by 2.02%, Sun Pharma down by 1.90% and NTPC down by 1.71% were the top losers. (Provisional)

Meanwhile, a joint report by the Federation of Indian Chambers of Commerce and Industry (FICCI) and Deloitte has expressed hopes for Indian retail sector growth in future, saying that the sector is expected to grow almost double to Rs 85 trillion by 2021 from the current estimated size of more than Rs 45 trillion, with a CAGR of over 10 percent in 2016-21.

The report said that the consumer data along with disruptions in technology will lead to growth in retail and FMCG sectors, noting that consumer experience will be the focal concern for all retailers and brands. For consumer business sectors, it said that internet will be a key growth driver and consumer data and insights will be at the forefront of defining the trends.

As per report, the data generated by shoppers and consumer behaviour would be leveraged to overhaul the consumer retail journey, using means such as Internet of Things (IoT) and predictive analysis. FICCI- Deloitte report further noted that growing number of smartphones, apps, web, social media users will also drive the growth of omni-channel retail, predicting that advertisers’ spending on digital marketing would double in the next 4 years to 24 percent of total expenses.

The CNX Nifty ended at 9924.40, down by 5.50 points or 0.06% after trading in a range of 9913.30 and 9963.60. There were 17 stocks advancing against 34 stocks declining on the index. (Provisional)

The top gainers on Nifty were Larsen & Toubro up by 3.77%, Bharti Airtel up by 1.47%, Tech Mahindra up by 1.16%, Kotak Mahindra Bank up by 1.08% and Vedanta up by 1.06%. (Provisional)

On the flip side, Mahindra & Mahindra down by 3.28%, Dr. Reddy’s Lab down by 2.87%, Sun Pharma down by 2.07%, BPCL down by 2.04% and Bank of Baroda down by 2.04% were the top losers. (Provisional)

The European markets were trading mostly in red; UK’s FTSE 100 decreased 15.57 points or 0.21% to 7,381.41, France’s CAC decreased 7.15 points or 0.14% to 5,107.47, while Germany’s DAX increased 8.54 points or 0.07% to 12,305.17.

Asian equity markets ended mixed on Friday on worries about the damage from Hurricane Irma in the US, as well as lingering fears about ballistic missile launches and nuclear weapons in North Korea. The US dollar weakened after the European Central Bank chief Mario Draghi indicated that the future of the bank's massive stimulus program may be decided in October. The ECB kept interest rates unchanged and also confirmed that its net asset purchases of 60 billion euros a month would continue until the end of December, or beyond, if necessary. Japanese shares ended lower as investors digested a raft of local economic data, including Japan's second-quarter GDP figures that were revised downwards. In addition, a stronger yen weighed on exporters' shares. Meanwhile, Chinese shares slipped to snap a three-week winning streak, as defensive consumers stepped back from a rally, although there were signs investors are pumping fresh money into a market buoyed by solid economic growth and a resurgent Yuan. August trade data showed China's exports rose 5.5 percent from a year earlier, which were in line with expectations but slower than July, while imports grew 13.3 percent, beating market forecasts.